One in five Lords is raking in the fees in Parliament 'cottage industry potentially worth millions'

One in five Lords is undertaking consultancy work in a Parliamentary ‘cottage industry’ potentially worth millions.

The figures can be revealed as four Labour peers are investigated over claims they were ready to take large sums to amend legislation.

One, Lord Taylor of Blackburn, was forced to apologise yesterday after he was revealed in secret recordings to have said that an annual payment of £100,000 was ‘cheap for what I do’.

And Lord Moonie, a former defence minister who is also at the centre of the investigation, is facing questions over his links to a defence industry lobbyist.

Allegations: Lord Taylor of Blackburn has made a public apology in the House of Lords over the corruption claims

As debate rages over whether peers are being unduly influenced by outside interests, the Mail has found that 145 peers out of 743 eligible to sit in the House of Lords are acting as ‘consultants’ or ‘advisers’ to outside interests.

In addition, they are exploiting a Parliamentary loophole which says they do not even have to state how much they are earning.

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Industries having their interests represented by Lords include banking, gambling, fast food, surveillance and other security systems, and nuclear power, as well as foreign governments.

Crucially, peers are allowed to speak during debates and vote on issues relating to their interests – as long as they declare that potential conflict within 24 hours of the vote taking place.

The exact amount of money peers are receiving from their external paymasters remains shrouded in mystery. Members are obliged only to declare how much they are earning for parliamentary lobbying activities – not ‘non-parliamentary consultancies’ which make up the vast majority of posts held by peers.

'Perfectly adequate': Lord Powell of Bayswater defends the system that lets members vote on issues relating to their interests

A non-parliamentary consultancy is when advice is provided to clients in a professional capacity and is wholly unconnected with any parliamentary work. For example, if a peer offers advice as a doctor, solicitor or accountant.

A parliamentary consultancy is when a peer is employed to offer advice on matters connected with parliament. These are distinct from paid work such as directorships, income from journalism, broadcasting or speeches.

In all, 244 consultancies are listed in the Register of Members’ Interests but just nine declare how much money they are receiving in their roles for parliamentary consultancy – admitting to a total of £205,000 a year.

At this rate, the total undeclared amount received by peers for ‘non-parliamentary’ work could easily run into millions.

Lord Taylor of Blackburn is listed as a ‘non-parliamentary consultant’ for the credit rating firm Experian. He allegedly boasted to undercover reporters that he worked to amend the law on their behalf.

And it was also revealed that Lord Moonie had given a pass to Robin Ashby, a defence lobbyist who was stripped of parliamentary pass last year

Under a crackdown last summer peers are only allowed to issue passes to "secretaries and research assistants'.

Mr Ashby, the managing partner of a lobbying firm and director general of the UK Defence Forum, is listed on the official register as having a pass courtesy of the Labour peer.

While Mr Ashby told the Daily Telegraph that he is no longer lobbying, Baroness Harris of Richmond removed similar credentials from him last June after accepting his role was "open to misinterpretation".

Since September Lord Moonie has tabled 40 technical questions regarding defence issues. In the previous six years, he had only asked six, official figures show.

Maurice Frankel, of the Campaign for Freedom of Information, said: ‘It’s absolutely a matter of concern if peers are getting into consultancy arrangements for which they receive money for unspecified work which nobody finds out about.

‘The bottom line is these latest revelations show we need a serious tightening of the rules regarding public disclosure of who does what for which organisation and why.’

A leading peer spoke out last night on behalf of the existing system.

Lord Powell of Bayswater, a crossbencher who has a ‘nonparliamentary consultancy’ for BAe Systems, said he did not see any reason for peers to declare how much they are earning.

The former adviser to Margaret Thatcher said: ‘Most people don’t have to declare their interests to anyone. It’s between the individual and the taxman.

'As long as you declare your interests fully there is no problem. The current system is perfectly adequate. Every time I speak in the House, I draw attention to my interests.’

Mark Wallace, of the TaxPayers’ Alliance, said: ‘People will be shocked to hear that one in five lords is holding one of these positions especially when they find that these relationships are so secretive.

‘If a member of the Lords is being paid to advise a company on public affairs they should declare how much they are getting, as to my knowledge it is an awful lot.’